If a Cost Must Be Arbitrarily Allocated in Order to Be

question 289

True/False

If a cost must be arbitrarily allocated in order to be assigned to a particular segment, then that cost should be considered a common cost.

---

Definitions:

Chapter 7

A provision of the U.S. Bankruptcy Code that involves the liquidation of a debtor's assets to pay off creditors.

Debtor's Estate

All legal rights, interests, and properties owned by a debtor at the time of bankruptcy filing.

Creditor

A person or entity that lends money or extends credit to another party.

Declare Bankruptcy

The formal process by which an individual or business legally declares their inability to pay outstanding debts.